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The Smith College Endowment & Fossil Fuels

March 31, 2017

​Dear Students, Staff and Faculty:

We write to update the campus community on the status of the college’s endowment with regard to fossil fuels. This letter follows on requests made by the student group Divest Smith College and expands on recommendations regarding impact investing outlined in the recently released report of the Study Group on Climate Change.

As of Dec. 31, 2016, the Smith College endowment had a total fossil fuels exposure of 6.6 percent. This figure reflects 3.1 percent in publicly traded investments and 3.5 percent in private funds.

We are pleased to report progress in the following areas:

Impact investing: In recent years, the Investment Committee of the Board of Trustees has increased its commitment to impact investing in the endowment, specifically in the area of environmental sustainability. In summer 2016, the committee approved the investment of $8.5 million in a private equity fund focused on energy efficiency and sustainable manufacturing processes. $1 million of the endowment is invested in sustainable global equity investments known as the Sustainability Series; that series is now entirely fossil fuel free. Today, 8.3 percent of the college’s endowment portfolio is invested with managers whose decisions are guided by environmental, social or governance (ESG) factors.

Investor responsibility: Since December 2015, the Advisory Committee on Investor Responsibility (ACIR), comprising students, faculty, staff and trustees, has been developing principles to ensure that Smith’s endowment continues to be invested in a manner consistent with the college’s mission and values. To inform its work, the ACIR has researched the history of socially responsible investing at Smith as well as investment and divestment actions taken by other colleges. The group will preview its draft principles for socially responsible investing in a series of meetings with the campus community this spring, with the goal of recommending final principles to the Investment Committee of the Board of Trustees.

Additionally, in the months ahead, ACIR will be considering and making recommendations to the Investment Committee regarding requests made by Divest Smith College to commit to no future fossil fuel direct holdings. It will also consider recommendations made by the Study Group on Climate Change to explore targeted opportunities for Smith to divest the endowment from fossil fuels in a manner that is consistent with Smith's tradition of prudent financial management and to increase impact investing. ACIR will also have the responsibility to periodically review the reporting of the endowment's fossil fuel exposure.

Education: As an educational institution, one of the most important roles Smith can play is in upholding evidence-based research and decision-making. In that spirit, while the Board of Trustees continues to review the overall recommendations of the Study Group on Climate Change, it has specifically endorsed the core principle of the group’s report: “Climate change is an urgent, complex problem. Human activities are pushing the climate beyond the range of conditions experienced over the last few million years and toward abrupt, unpredictable, highly damaging and potentially irreversible impacts. Effective responses will require ambitious, multifaceted plans of action.”

We thank you for your commitment to addressing the challenges of climate change. We will continue to keep the Smith community informed on the college’s progress toward an environmentally sustainable future.


Kathleen McCartney

Deborah L. Duncan ’77
Chair, Smith College Board of Trustees